Why Discretionary Review Is Not Unconstitutional

Attorneys Jonathan Feigenbaum and Scott Riemer, who represent claimants in long term disability cases, have published a fascinating article, titled “Did the Supreme Court Flunk Constitutional Law when it Permitted Discretionary Review of Insured ERISA Benefits Cases?” In it, they argue, not surprisingly given the title, that it is unconstitutional for courts to apply discretionary review. In short form, their argument is that it deprives claimants of their constitutional right to have their cases adjudicated by an Article III court, by giving initial decision making, subject to a limited scope of review, to an outside, non-judicial party, without allowing for a full trial in court. This is a simplification of their well-developed thesis, which is more subtle and complicated than that, which is what makes it fun.

The response to their argument, though, rests in the proper response to a gauntlet the authors throw down at the outset of their paper, in which they challenge readers to:

identify any litigation in the federal courts between private litigants, other than discussed in this paper, where the Article III Judge must defer to the decision of the defendant without conducting a full trial on the merits. We bet you can’t.

This isn’t really what discretionary review does, however. Instead, it is simply a presumption running in favor of the private decision maker – who is best understood as a party to a contract who made a decision that is now being challenged in court by the other party to the contract – under which the other party must rebut the presumption by showing that the decision was not based on substantial enough evidence to support it. The American legal system is rife with these types of presumptions. What is the Moench presumption in stock drop litigation, if not a presumption running against the claimants that they can overcome with the right type of evidence? Employment law, with its burden shifting evidentiary rules, historically was rife with similar examples, in which one party bears a burden of proof only after another party makes a certain showing. The business judgment rule applies a gloss in favor of directors and officers in certain types of cases, which must be overcome by a plaintiff. Patents are presumed valid when challenged in court, and a holder of a registered copyright is presumed to have a valid copyright, unless and until proven otherwise in court.

One could go on like this for hours, making such a list. The point, though, is simple: discretionary review is not an unconstitutional removal from the court system of decision making authority over a claim, but rather the creation by the courts of an evidentiary presumption and a burden of proof, no different than what occurs in numerous other areas of the law.